L & T says China is systematically killing Indian manufacturing sector;

Budget 2010 to be presented on February 26; Budget Session to begin on February 22;

Q1 magic does wonder for 2009;

PM to launch National Solar Mission today;

Health Minister invites NRIs to invest in Indian health sector;

CCEA gives nod to Gazprom for addl work & exention beyond Exploration Phase III;

TIOL COMMENTARY

ddt 11 jan.pdf

Import of flat Rolled Products of Iron or steel – Restriction removed;

tiol top.pdf

Learning Lessons from Hanuman Chalisa;

icecube.pdf

Ask all companies to embrace transparency;

story.pdf

Q1 magic does wonder for 2009;

MIXED BUZZ

mbuzz1204.pdf

PM to launch National Solar Mission today;

mbuzz1203.pdf

Health Minister invites NRIs to invest in Indian health sector;

mbuzz1202.pdf

CCEA gives nod to Gazprom for addl work & exention beyond Exploration Phase III;

2010-TIOL-28-HC-MAD-IT.pdf + transfer story.pdf

Noorul Islam Educational Trust Vs CIT (Dated: December 11, 2009)

Income Tax – Transfer of case from one AO to another – both the Commissioners should agree, assessee must be given reasonable opportunity and valid reasons for transfer must be stated in the order: A conjoint reading of section 124 & 127 2((a) & (b)of the Income Tax, 1961 reveals that in the case of transfer of case from one Assessing Officer to another Assessing Officer, who are under the control of different Commissioners, the statutes requires compliance of three requirements:

[i] that both the transferring Commissioners and the Commissioner within whose jurisdiction, the case is to be transferred must agree for the transfer.

[ii] The assessee must be given reasonable opportunity of hearing; and

[iii] The reason for transfer should be recorded in the order.

Further, the reasons stated in the impugned order, must be valid reasons justifying the transfer. :MADRAS HIGH COURT;

2010-TIOL-20-ITAT-DEL.pdf + turner story.pdf

Cable News Network LP, LLLP Vs ADIT, New Delhi (Dated: November 6, 2009)

Income tax - Sec 90, Rule 44H - Indo-USA DTAA - MAP - Assessees are non-resident broadcasting companies - operate in India through PEs - earn advertising and subscription revenue through agent - pay commission to the agent based on the collections - Revenue for 30% tax on net revenue - both parties agree for Mutual Agreement Procedure for resolution of dispute - 10% deemed profit determined by US Competent Authority - whether 10% profit is leviable on gross revenue or net revenue - whether an assessment order passed under MAP is appealable under Sec 246A(1)(a) :DELHI ITAT;

2010-TIOL-19-ITAT-DEL.pdf

M/s Xerox India Ltd Vs ADIT, New Delhi (Dated: October 9, 2009)

Income Tax - Sec 32 - Assessee write off value of fixed assets, not found on physical verification - AO takes the view that depreciation cannot be allowed on non-existent assets - makes disallowance @ 20% - CIT(A) reduces it to 10% - held, Revenue not justified in working out depreciation on a block of assets by reducing the value of any asset/assets which have either been discarded or destroyed or sold or written off. It means that in a case, some asset, which formed part of the block of assets, is discarded or destroyed or sold or written off their WDV is to be reduced from the WDV of the block of assets for the purposes of computing depreciation and not the WDV of individual assets by working out the same itemwise. AO should recompute the depreciation only after ascertaining the scrap value of the assets, which have been discarded or written off in the books during the year under consideration. Revenue's ground rejected.

On the issue of deduction claimed by the assessee u/s 10A - AO holds that the assessee company is not entitled for deduction u/s 10A - CIT (A) holds that the assessee  fulfills all the requirements of section 10A and is covered within the definitions given in Explanation 2(vii) to this section - Held, CIT (A) in his well-reasoned and well-discussed order after analyzing the provisions of section 10A as well as the notification and subsequent approvals of the Government of India in the case of assessee has rightly concluded that the assessee fulfils all the requirements of section 10A and is covered within in the definitions given in Explanation 2(vii) to this section. Revenue's appeal rejected.:DELHI ITAT;

2010-TIOL-18-ITAT-DEL.pdf

ACIT, New Delhi Vs China Trust Commercial Bank (Dated: Novenber 13, 2009)

Income tax - Sec 37 - Assessee is a non-resident bank - buys government securities to maintain SLR - Securities are kept with the RBI but are tradable - RBI pays interest every half year on May 12 and November 12 - any transaction in between these dates results in broken period interest - Assessee has been following the practice of deducting the broken period interest from the sale price of securities at the time of sale - change in practice following some judicial decisions - assessee claims deduction for broken period interest expenditure and also claim deduction for any loss arising out of sale of securities - AO treats it as double benefits and makes addition - CIT(A) directs the AO to examine whether the claim of the assessee results in double deductions - held, the method of accounting is at the discretion of assessee and not AO. In the year of change of method of accounting, there is bound to be effect on ultimate income computed. However so long as the method followed by the assessee is one of the recognized method and thereafter consistently followed the same cannot be found fault with. Revenue's appeal dismissed:DELHI ITAT;

2010-TIOL-17-ITAT-BANG.pdf

Shri M R Kubendrappa Vs ITO, Davangere (Dated: September 11, 2009)

Income tax - Sec 144, 68, 69 - Assessee is a retail dealer in gold and silver ornaments - declares agriculture income - AO partly allows it - CIT(A) makes addition of the entire sum and also disallows the gift received from NRI - held, when a major part of agricultural income has been allowed by the AO, the CIT(A) is not fair in disallowing the entire sum and taxing the same u/s 68- if such an income is to be taxed as unexplained credit, the assessee must be given ample opportunity to explain the same - issue remanded

As regards the disallowance of gift, since the creditworthiness, identity and genuinness of the donor is established, the same cannot be disallowed and added as undisclosed income u/s 68 - Assessee's appeal allowed:BANGALORE ITAT;

SERVICE TAX SECTION

2010-TIOL-59-CESTAT-AHM.pdf

M/s Cadila Healthcare Ltd Vs CCE, Ahmedabad (Dated : August 3, 2009)

Service Tax – Technical testing and analysis service, C & F Agent service, Courier service and Commission paid to foreign agents are input services, credit available – Impugned order set aside:AHMEDABAD CESTAT;

2010-TIOL-58-CESTAT-MAD.pdf

M/s The Lakshmi Mills Co Ltd Vs CCE, Tirunelveli (Dated : September 18, 2009)

Service Tax – Business Auxiliary Service – commission paid to the overseas agent for procurement of export orders – no service tax is payable by the recipient in India prior to 18.04.2006.:CHENNAI CESTAT;

2010-TIOL-57-CESTAT-BANG.pdf

M/s Tribhuvan Motors Ltd Vs CST, Mangalore (Dated : May 13, 2009)

Service Tax – Business Auxiliary Service – Payments received from financial institutions by authorized dealers of motor vehicles for counter/table space provided for business – Nothing on record to indicate that appellant promoted services provided by various financial institutions – Not liable to service tax under BAS – Impugned order liable to be set aside:BANGALORE CESTAT;

2010-TIOL-56-CESTAT-BANG.pdf

M/s LSG Sky Chefs ( India ) Pvt Ltd Vs CC, CCE & ST, Hyderabad (Dated : August 31, 2009)

Service Tax - Outdoor Catering Service - Eligibility of Exemption Notification 12/03-ST for supply of food - When sales tax is paid on supply of food, service tax cannot be levied simultaneously as they are mutually exclusive - Impugned order not sustainable:BANGALORE CESTAT;

CENTRAL EXCISE SECTION

2010-TIOL-63-CESTAT-MUM.pdf + asiatic gases story.pdf

Asiatic Gases Ltd Vs CCE, Mumbai (Dated : October 30, 2009)

ROM application need not be disposed off within six months of the date of the order passed by CESTAT u/s 35C(1) – only requirement is it (ROM) is to be filed within six months – CESTAT over-rules Revenue's objection and allows ROM application.:MUMBAI CESTAT;

2010-TIOL-62-CESTAT-MAD.pdf

CCE, Chennai Vs M/s Hindustan Motors Ltd (Dated : October 15, 2009)

Central Excise – Show cause notice after finalization of provisional assessment – the order of the lower authority setting aside the demand on the ground that the original authority had become functus officio is erroneous – Section 11 A provides the relevant date as the date of finalization of provisional assessment and show cause notice can be issued within one year from that date.:CHENNAI CESTAT;

2010-TIOL-61-CESTAT-BANG.pdf

CCE & CC, Calicut Vs M/s Elgi Tread ( India ) Ltd (Dated : March 31, 2009)

Central Excise – Valuation – Inclusion of customs duty, surcharge and special additional duty debited in DEPB scrip for arriving at cost of production under Rule 8 of Central Excise Valuation Rules – Notification No. 34/97-Cus being an exemption notification as held by Larger Bench in Essar Steel 2004-TIOL-807-CESTAT-DEL-LB , debits in DEPB scrips not to be regarded as costs includible in AV arrived under Rule 8 – Impugned order legal and proper:BANGALORE CESTAT;

2010-TIOL-60-CESTAT-DEL.pdf

M/s DCM Engineering Products Vs CCE, Jalandhar (Dated : August 18, 2009)

Central Excise – MODVAT/CENVAT Credit – Pattern tools pertaining to OEM manufactured in one unit and transferred to sister unit on payment of duty for use as capital goods for manufacturing automobile components – Invoice raised on OEM for sale of pattern tools, but retained for manufacturing automobile components – Since pattern tools were not physically removed from factory of appellant, no requirement to reverse MODVAT Credit – Impugned order set aside :DELHI CESTAT;

2010-TIOL-55-CESTAT-BANG.pdf

CCE, Mangalore Vs Campco Chocolate Factory Ltd (Dated : April 30, 2009)

Central Excise – Job worker arrived at assessable value based on cost of raw material, packing materials and conversion charges – No infirmity in computation of assessable value in view of Apex Court decision in M/s Pawan Biscuits 2002-TIOL-04-SC-CX case when there is no mutuality of interest or evidence of flow back of funds from principal – No merit in revenue appeal:BANGALORE CESTAT;

CUSTOMS SECTION

2010-TIOL-64-CESTAT-MUM.pdf + nls agency story.pdf

M/s NLS Agency ( India ) Pvt Ltd Vs CC, Mumbai (Dated : September 9, 2009)

Re-export of containers – CESTAT says it is constrained to direct reasonable pre-deposit towards penalty as Importer had acted with impunity regardless of the mandatory provisions of the notification.:CHENNAI CESTAT;